It’s that time of year where you peer outside after a long winter and see an unwelcome amount of debris and disorder awaiting your spring cleaning efforts. The fortunate among us hire a cleanup crew. The planners among us pay attention to the friendly offer from the city to help haul it away for you. But, we’re clearly not all fortunate or planners.
While a nice looking yard is enjoyable, cleaning up your financial debris and disorder is far more important. Many people just never seem to get around to it. Let this serve as both a friendly reminder and an easy-to-follow starting guide.
As always, the most important step is the first one. Start by simply writing down your personal list of those nagging and long-neglected, money-related items in your life. But, be sure to keep it brief at first. People often craft an emotionally impossible list of things to accomplish. The result is entirely predictable; continued procrastination.
In the name of simplicity, craft your list into digestible bites that will allow you to move along the path to a simpler and more efficient financial setup. To begin, I will highlight three key areas you should focus on.
Start by taking a good look at your money mechanicals.
These are equivalent to digging out your dirty, outdoor furniture from winter storage or turning on your sprinkler system or taking your lawnmower in for that overdue tune up. If you ignore your mechanicals for too long, it gets awfully difficult to actually enjoy those summer moments. The same thing happens in your financial life.
I suggest an initial focus on three tasks and then move deeper from there.
Start by reviewing the inventory of your investment and financial accounts and taking special note of your current beneficiary designations for your retirement accounts and your life insurance policies.
Next, dig out your old, dusty, estate planning documents and make sure your former self’s thoughts are still valid and that nothing is worthy of a formal reevaluation.
Finally, have that short and important conversation with your spouse or loved ones about how they could actually access all of your accounts in the event you were no longer around. Write it all down on a single sheet of paper and keep it in a secure place. This simple step will absolutely save a lot of pain and inconvenience at a difficult time.
Together, these simple first steps will likely open up a world of profound thoughts regarding your financial affairs. Don’t let that scare you.